Field statements, the last bastion of 1980’s claim handling, are on the verge of going the way of the dodo bird. This trend started long before the pandemic, with insurance companies realizing expense reductions by trimming the number of company cars on the road for their SIU and FIU personnel. But are there cases where it still makes sense to take a field statement? And is it possible those statements might be higher yield than those taken over the phone?
The case for phone statements is simple. In today’s society, consumers demand convenience and instant gratification. You don’t have to look any further than the growth of Amazon for affirmation of this. Consumers want value, and they want it instantly. Field statements are the antithesis of that sentiment. They lengthen the process of making liability decisions, adversely impact customer service and delay the process of subrogating.
Some still believe statements taken in the field to be superior to those taken over the phone. If the statements taken in the field are indeed better- if they yield more information, if they are better at uncovering fraud- surely that could defray some of their inherent cost. And if another task can be performed in the field at the same time the statement is taken- for instance, if the adjuster takes pictures of the scene, or the vehicle- would that make it worthwhile?
The fact of the matter is there is a massive gulf in logistics between phone statements and field statements. As soon as you are able to reach the contact for a phone statement, you may begin the statement immediately, and continue moving the claim along. In a field statement, the phone call is only the first step. After you contact the interviewee and schedule an appointment, you still find yourself crossing your fingers that the interviewee will actually show up. If the person you’re interviewing doesn’t have a stake in the claim, the likelihood of that happening is probably less than 50-50. And if the appointment is cancelled and rescheduled, you’re back to square one.
Often, it’s a week or two before the interview takes place and then another week or so before the investigator writes up the report and sends it along. Meanwhile, the adjuster is receiving calls on a daily basis about the status of the claim. Phone calls shorten that timeline dramatically, with statements usually taken within a matter of days instead of weeks.
The impact is felt well beyond the liability decision. The longer a liability decision takes, the more it impacts customer service. If it’s your policyholder that’s being held up, you run the risk of non-renewal. If it’s an injured third party claimant, maybe they start rethinking seeking attorney representation for that lingering back pain? You’re also delaying subrogation, which means more time without essential funds flowing back to the insurer.
This logistics gulf means that in addition to taking much longer, field statements are typically much more costly than a phone statement, as well. But do in person statements make up the gap by providing more information? Is there a value in seeing a person as they are speaking that shows up in a meaningful way in a statement’s yield that makes it worth all the added time and expense? We believe the answer is no. If an adjuster is trained in the art of taking a high yield statement, they will be equally adept at taking them in the field and over the phone. There should be no denigration in quality.
What about fraud? It’s true that a field adjuster is (slightly) better positioned to detect fraud than an adjuster over the phone, but the vast majority of fraud indicators should be uncovered by a well-trained statement taker who asks good follow-up questions and pays attention to detail. Those kinds of high-yield statements can be taken anywhere and if both adjusters require that same training, the cost benefit and simplicity of the phone interview is too great for the field adjuster to overcome.
But what if a field statement is combined with another task? This is the last reasonable defense of the field adjuster, and it’s also losing tenable ground. In the digital age, the need for an adjuster to be present on scene is disappearing rapidly. Most insurance companies feature an app where the claimant can upload images and even video of damages themselves. Some have even automated processes for sorting and appraising this information. And when the claimants can’t provide that information, like in the case of California wildfires, insurance companies can call on drones to assess damage, sometimes weeks before any human being could approach a site.
Field adjusting is costly, takes a long time, and it fails to recoup any significant advantages to compensate for these major drawbacks. Frankly, we’re surprised that companies still outsource this function to independents. Considering the impact a time delay has on subrogation and customer service, consider this an emphatic checkmark in the box for phone statements over field.
Does your company still use field adjusters? Are there any advantages you’re seeing that we missed? Or are you curious how you can get better yield from your phone statements? Leave a comment here, or find us on Twitter @acsacc.